Did you know that a third of all invoices are paid late? That’s a lot of invoices and a lot of cash. Some, on the other hand, succeed like professionals by paying on or before the due date. How is it possible that the latter get paid so quickly?
So we’ve tried to give you tips from lucky entrepreneurs who get paid early, and unpack their invoice payment system/set-up methods for everyone to use.
What are the billing terms?
The terms and conditions mentioned on the invoice are rules or policies set by the company regarding the following.
● Payment method.
● Payment cycle
● Currencies for global companies.
● Late fees
● Due dates
● And legal transactions
For all invoices, due dates are one of the most important elements of the invoice. The date the invoice is issued and the due date are crucial to receive payments on time. A smart businessman not only monitors his own payment cycle, but also that of his customers. He knows exactly when his customer’s payment cycle starts and sends the invoice at that time.
So that the invoice stays on top and is completed on the first payment.
Is this a wise decision? Have you ever thought about it?
But messages take time? How can you be more accurate with your billing and payments? Implement an online bill payment system. A billing software sends invoices by email, which is faster.
With online payments, you can transfer payments with a single click. Your customers don’t even have to move a step. Isn’t that cool?
Shorter terms mean faster payments
Bills with shorter terms may be late on their due date, but they’re still usually paid sooner than other bills in the queue.
Human psychology tells us that late deadlines cause panic, and that’s when you tend to settle earlier.
● The average bill that is due a week later is usually paid in at least 13 days.
● A bill due on the 14th is paid in 18 days.
● A bill that is due in three weeks takes 25 days to pay.
● A bill due within a month is paid in 40 days.
General payment terms change
Don’t worry about offering shorter payment terms. You’re not the only one involved. Today, more than 75% of companies offer invoice processing within 2 weeks. So the market is changing, and so are expectations.
There may be expectations for customers with larger invoices, but these can be negotiated. Offer discounts, instalments or ask for interim payments to speed up payments.
Send an invoice as soon as possible.
One of the easiest ways to start to bill your clients invoicing online as soon as you’ve finally completed the work they’ve asked you to do. Once you’ve completed your work and received a satisfactory response from the client, send them an invoice. That’s when your clock starts ticking, and you’re guaranteed to get paid at the earliest.
Never underestimate the invoicing process and never delay it. Every time you do, you delay your payday and end up hurting your cash flow.
Tracking payments is ok
You don’t have to wait until the due date of an invoice has passed. It’s perfectly fine to send a little reminder when an invoice is still outstanding. Try sending a friendly email or voice message to remind your customers about payments.
An online bill payment system like Invoicera has automatic payment reminders. Choose templates that allow you to schedule or customize payment reminders to be sent to customers. Set the dates and schedule the frequency of reminders according to approaching due dates. Just don’t go overboard with the reminders. It’s unprofessional.
Here are five key tips to help you get paid faster.
Internal cash flow is the extra cash that keeps a business running. However, pricing does not guarantee the company monetary rewards. So here are 5 best payment practices to follow to get paid on time.
● Finalize your payment terms before you start
When discussing a project, finalize your payment terms. It’s always helpful to set your policies openly upfront beforehand. Clearly inform your client about your offline or online bill payment system, billing cycle, billing method and penalties. Emphasize this sufficiently to ensure that your customer takes it seriously. Discuss and bend policies where possible. But make sure you do all of this in a timely manner.
● Make sure your account is self-explanatory.
The invoice is a list of services/products provided with full payment and contact details. It is an important document that involves money. So make sure that every invoice can be fully explained without the customer having to call you again and again. Add a detailed list, but if necessary, add details of the items listed.
● Send the invoice directly to the mailbox of the person concerned.
Ask for and send the invoice only to the mailbox of the interested party. This will improve your chances of receiving payment in a timely manner. Remember that the invoice clock only starts when it reaches the right person at the right time.
● Keep in touch with your customers
To make sure your bill gets paid on time, constantly remind your customers about payments. Send gentle reminders or automate reminders with electronic bill payment systems to remind your customers of payments.
Finally, create an online invoicing payment system that works
Billing is boring, but very important. To make it convenient and easy, you can set up an online invoicing payment system in your business. Online billing software helps you create invoices, receive payments and keep records. The latest software also allows for automation.
Automation means that the software can automate invoices and send them to customers when you schedule them in advance for the day. They also offer several features such as payment tracking, invoice tracking, logging, sending reminders, and many others to help your business grow better.